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It is expected that climate change, in addition to higher temperatures on the globe, will also lead to the melting of glaciers and sea ice, which in turn will lead to rising sea levels. We also know that more CO2 in the atmosphere will again increase the absorption of CO2 in the ocean, which will make the ocean more acidic. We know less about the consequences of more acidic oceans, but it is likely that it will provide better growth conditions for organisms that can absorb CO2 through photosynthesis (for example algae) and worse for other species. A possible consequence of this is more extensive algal blooms, lower oxygen levels and potentially also changes in large ocean currents. On land, it is expected that changing rainfall patterns will make it more demanding to cultivate the soil in many of the traditional agricultural areas. All of these are potential physical consequences. It is currently not possible to reliably estimate the financial impact.
In our view, aquaculture is an important part of the solution if we manage to adapt and develop. Aquaculture has a lower carbon footprint than other livestock production, takes up little land and uses very little fresh water. Climate change should therefore lead to increased demand for sustainable seafood with a low carbon footprint.
Our vision is to set the standard for future aquaculture. It also means that we must take account of the consequences that climate change can have on aquaculture. To be specific, this is about reducing the potential negative consequences that can arise as a result of both impacts from climate change in the sea, but also other external threats such as algae, lice, predators and diseases. To be able to do that, we need to gain better control over the water conditions inside the pens, more insight into changes in the environment, and an opportunity to change the water quality. These are some of the challenges we are working to solve.
Investments in R&D is key to succeed and in 2020 we created Eide Sustainable Marine Technology AS to spearhead our technology drive. Based on our 50 years of experience in aquaculture we believe in finding solutions that work with the forces in nature rather than challenging then; Avoid rather that fighting lice and disease, use the properties of the environment to your benefit rather the try to withstand it, and choose your environment accordingly. And based on this experience we started to conceptualize how we envision the future of aquaculture. We have called our vision WATERMOON.
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In Eide, we get up every day to shape the future of aquaculture.
The world needs a reduced footprint, healthier, and more sustainable food. At Eide, we’ve created a new production platform where the goal is to reset the standard for seafood production. This work is a constant journey, and the platform will continuously evolve to keep getting better.
Over the years, we have examined many alternative production technologies. We found none that put the fish at the center. We know we need solutions that improve, not complicate, food production.
As we navigate through uncharted waters, we are aware that this is just the beginning. Watermoon is not just a technological innovation; it is the cornerstone of a fresh environmental technology, tailored for each individual fish. Nature has given us direction - in everything from texture to taste. In its natural element, the salmon explores the entire water column. With Watermoon, we have not only acknowledged this natural propensity but enhanced it. We have breathed life into an environment for each fish, shielded from the changes of nature. And at the heart of this, it’s not just about technology, but about taking care of the ocean.
At first glance, one might see Watermoon as just another tool. But it represents a much deeper shift. Biology, in its essence, is not about the outward form, but about understanding the experience of each fish. Much of our work has been intense exploration - fine-tuning water currents, acoustics, light, and all other biological factors, so that the salmon can experience an essence of nature in Watermoon. Over five decades of biological knowledge, combined with billions of data points, are fused together in what makes Watermoon unique. But we don’t stop here. We want to keep going; we know that everything is about constantly developing and improving.
The fish farming industry has challenges with lice, waste, and escapes. The world must solve challenges with climate, nature, and food production. Watermoon contributes to the solutions. With Watermoon, we reset the standard for the future of aquaculture.
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To feed a growing population we need more food. However, many of the traditional food chains are under pressure. The availability of marine ingredients are also limited. We therefore believe that we need to find new ingredients for the salmon feed in the future, and it is important to us and to our stakeholders that we contribute to this development.
We don’t have all the answers, but we want to contribute to develop the feed ingredients of the future by investing in R&D and feed trials with new feed ingredients. We shall seek ingredients that are better to the environment without compromising on fish welfare or the quality of the product. These will be tested in a commercial scale in our R&D sites.
In the early days of the salmon farming industry the feed consisted of mainly fish oil and fish meal produced from wild caught fish stocks. Today, most of the feed consists of plant-based ingredients such as soy, rapeseed and wheat and only a small share of marine ingredients. This has been important for the industry, and a lot of work has been done to reduce the use of fish meal and fish oil. Fish meal and fish oil from wild caught stocks is a limited resource and cannot meet the demand for the future. At the same time there are also challenges in using plant-based ingredients. Marine ingredients is the most natural choice for the fish, and many of the plant-based ingredients has their own challenges to deal with, like deforestation and land use change, erosion and limited freshwater.
Through our subsidiary Norforsk AS we operate two R&D licenses in Nordfjord in cooperation with the Norwegian Veterinary Institute and NMBU. These feed trials focus precisely on this matter, research and development on new feed ingredients. One of the challenges with plant-based ingredients is that these may impact the intestinal health of the farmed salmon negatively. Norforsk are testing different feed ingredients to discover potential changes in intestinal health, growth rate, feed conversion, lice levels and mortality.
I 2021 we invested in new research and trial facilities. Our research station on Isane got upgraded with a modern ten-cage farm with integrated feed barge, battery-hybrid power supply and its own field laboratory. Norforsk also has their own PhD candidate, Linn. She is from Osmundsvåg in Nordfjord and will work on our feed research while writing her PhD at NMBU. In 2022 we got our first IMTA license. IMTA, or integrated multitrophic aquaculture, is based on producing several species together in symbiosis. This is the first small step towards utilizing the nutrients from the salmon to potentially producing new, local feed ingredients in the sea.
Norforsk started with feed trials in 2011 when we investigated how different protein sources affected the intestinal health of fish. The starting point for this was that some plant ingredients turned out to cause intestinal inflammation in the fish. The feed industry’s desire to become independent of scarce marine feed resources with plant-based ingredients could seem to have had a potentially negative effect on the fish’s health and welfare. We therefore initiated experiments with the aim of making the plant-based feed ingredients easier to digest by fermenting the vegetable proteins before they were added to the feed. The feed ingredients being tested were different amounts of fermented plant-based ingredients and meal from macro algae. We now also started feed trials using meal from insect larvae. These are a potential circular protein source, since they can feed on waste from other sources of food production. We believe that this ingredient may be better suited for the salmon than the traditional plant-based ingredients. We currently perform trials using meal from black soldier fly larvae to test if this is a good protein source for salmon.
The results so far are promising, and we are excited to get more results soon. You can read more about the results and our research and trial on www.norforsk.com
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We want to offer our customers full traceability of the salmon, with information about how and when the roe was hatched, what vaccines the fish has received, what feed it eats, slaughter time and so on. This is our main focus. In addition, we must ensure that suppliers in our value chain operate in line with laws and regulations and respect basic human rights. Third-party certifications are important here.
100% of our facilities are certified according to the Global Gap standard, a global third-party certification that has a strong focus on both tracking and social conditions. Global GAP also audits our key suppliers.
Our feed includes marine raw materials in the form of fish oil and fish meal. Part of this comes from off-cuts and by-products, and part comes from wild fish that are unsuitable or unattractive for human consumption. All the marine raw materials in our feed come from fisheries that operate in line with FAO’s principles for sustainable fisheries, including by-catch and by-catch, and do not originate from IUU fishing (illegal, unreported or unregistered) or from species classified as critically endangered or threatened in line with the IUCN’s Red List.
The marine raw materials included in the feed consist of several species from different areas and have various third-party certifications, the most useful of which are MSC and MarinTrust, as well as fishery improvement programs such as FIP and MarinTrust IP. A small proportion are not certified, which can be attributed to various reasons, such as by-catch from certified fisheries, volume from fisheries where FIP is being established, or a short-term shortage of certified raw materials. According to our main feed supplier, 94% of the marine raw materials came from certified fisheries. You can read more about the marine feed raw materials in the topic on biodiversity.
Of the plant-based raw materials, soya has been the most controversial, usually in connection with the risk of deforestation. Eide therefore only uses European soy, and 100% of this is certified according to the Europe Soya standard. All plant-based raw materials in feed for our fish are GMO-free. Both marine and plant-based raw materials can be traced to our feed suppliers, at least to national level for origin.
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As a family business with a generational perspective, it is incredibly important to have good and ethical business practices. Everything we do must be done in line with our values. We recognize and respect the basic human rights. We have zero tolerance for all economic crime such as money laundering, embezzlement, extortion, price collusion, corruption and fraud. We follow the rules that apply at the workplace, and we support and recognize the worker’s freedom of trade union, freedom of religion and freedom of expression, as well as the right to a decent living wage. We have zero tolerance for all forms of child labor and forced labor. We expect all our partners, suppliers and subcontractors to also comply with these principles.
We are a small and transparent business, and our focus is to build and maintain good attitudes and relations based on mutual trust. Reliability is one of our core values, and we shall be trustworthy. We also expect the same from our customers, suppliers, partners and employees.
In addition to our core values, we have implemented policies and procedures to reduce the opportunities to break the rules and values. We ensure this through e.g., close involvement from owner to operator and segregation of duties between the farms and the office and with our external accountant.
Happy and healthy employees with a decent and fair salary also contribute to reduce the chance that someone might feel pressure or need to break the law or our internal procedures.
We have carried out a risk assessment for violations of human rights in our value chain in line with the requirements in the Norwegian Transparency Act and have published our statement about this work which is available on our website and in this report.
We have also carried out an internal risk assessment linked to the risk of corruption. This shows that the risk is greatest for employees who work in the hall, purchasing and business development, as well as for our managers. We have not carried out specific training in anti-corruption work among our employees, but we plan to complete such training for those employees where the risk is greatest.
We have established ethical guidelines which also cover our anti-corruption policy. These are communicated and made available to all our employees through our HSEQ management system.
We have not identified and cases or suspected cases of corruption or fraud in 2022, neither in the Eide group, nor with our suppliers.
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Our work with managing the risks related to human rights are anchored in our vision to “Set the standard for the future of aquaculture”. In our view this vision requires us to implement a foundation based on respect for the basic human rights in every aspect of our business, including our suppliers.
The work is also embedded in our core values which are Reliable, Bold, Passionate and Creative. With reliable implies that we shall have faith and trust in each other, and act according to our beliefs. Bold implies that we shall not be afraid to speak up when something is not right, and we shall dare to follow our own path instead of following the herds. We expect the same from our suppliers.
We have four pillars and promises defining how we conduct our business. We call it our four F-s; Folk, Fish, Fjord and Future. Our pillar “Folk” is about how we treat people, from our employees, to our customers and suppliers as well as the people living in the local communities where we operate.
In addition, we have also established a Code of Conduct for the group and for our suppliers.
We have not identified any cases of adverse impacts on human rights, or suspicions of such impacts.
We have performed a qualitative risk assessment where we assessed the inherent risk of different processes and activities in our business based on two criteria; What type of labor is used for producing the goods or services, and what country or region is the goods or services normally produced in.
Our business areas are all located in Norway, and we purchase the majority of our goods and services from local Norwegian suppliers. Within this category we have all our smolt suppliers, electricians and automation, ship wharfs for repairs and maintenance of our vessels, lease of vessels used for transport and delicing, and purchase of slaughter services. Due to the high protection of human rights in Norway and a high share of we consider the risk to be low for these suppliers.
We also have some suppliers of goods and services in other European countries. For these we also consider the risk to be low when the goods or services is based on an advanced and skilled workforce. In some cases, e.g., when building new barges or vessels, the hulls might be built in foreign ship wharfs. This types of purchases will normally include a combination of advanced and manual labor, and we consider the inherent risk to be moderate in such cases.
We identified two types of suppliers with a high inherent risk for further investigation. These are suppliers of fish feed and suppliers of fish nets and ropes. Fish feed accounts for a significant share of our production costs, and the feed ingredients may be produced in a wide range of countries, including some vulnerable areas with low protection of human rights. Production of fish nets and rope require a lot of manual labor and may occur using subcontractors in low-cost countries such as India. We have in total five suppliers in these categories.
Risk assessment meetings
We have conducted introductory meetings and communications with our feed suppliers to understand how they assess and address the risk. The main purpose of these discussions was to support and verify our initial risk assessment. Based on the discussions we adjusted the inherent risk for one of the suppliers down to moderate as raw materials where not sourced from high- risk countries. For one of the suppliers, we maintain the assumption of high inherent risk.
We conducted similar introductory discussions with our fish net suppliers to also assess this risk further. Based on the outcome we maintained our assumptions of high inherent risk as we confirmed our initial hypothesis of production in low-cost countries with subcontractors.
We have performed additional due diligence procedures to address the remaining high-risk suppliers. We requested supporting documentation of policies and procedures for sourcing, risk management, supplier audits and any third-party certifications, as well as the supplier’s own declaration on the Transparency Act for those covered by it.
Based on the reviewed documentation it is our view that the suppliers have implemented appropriate policies and routines for risk assessment, sourcing and supplier approvals, and that they conduct supplier audits for areas with significant risk. All the suppliers also have one or more third party certifications that further reduce risk, e.g., Global GAP, ASC, ISO 9001 and «Great place to work», and the suppliers are also subject to report according to the Norwegian Transparency Act. Based on this we consider the risk after implemented measures from our suppliers to be moderate and acceptable. We will follow up with monitoring on areas with high inherent risk to verify that the procedures are implemented and functioning according to the design.
We will continue the work to increase our own knowledge of the supply chain in order to further reduce the risk of adverse impacts. We will make clear demands to our suppliers, while continuing to have a good dialogue with then.
We will also consider to implement standardized requirements for specific third- party certifications for suppliers. Combined with our own risk assessments and implementing both preventive measures and due diligence procedures on high-risk areas we consider the overall risk of adverse impacts in our supply chain to be low.
